Do you know business credit cards are different from your personal credit cards? In this post, we will find out how they are different and how they affect personal credit. Knowing the differences will help you better manage consumer debt.
Business Credit Cards – How Is It Different?
There are two fundamental differences between personal credit cards and business credit cards.
- Consumer protections: Business cards do not have the same consumer protections as personal cards. There is a possibility that you are faced with high fees that are generally not applied to personal accounts. However, you may find some lenders that offer these benefits. Therefore do your research before you settle down on a card.
- Rewards Offered: Certain business credit cards offer discounts in certain business categories such as office supplies or bills. Therefore make sure you pick the right card that suit you depending on the spending categories that are most prominent for you.
Although there are fundamental differences, your personal credit and business credit will go hand in hand. Therefore, maintaining your personal credit history is crucial. Lenders will often report to both personal and business credit bureaus. Therefore, maintaining your credit discipline throughout your business and personal finances are imperative to your credit success. Carefully monitor your business as well as personal credit card payoff strategies.
What Should You Look for In Business Credit Cards?
- APR– What is the APR on your business credit cards? Unless your finances are stable enough to pay the balances in full every month, you need a proper understanding of the rate you get.
- Penalties/fees– As with a personal credit card, look out for any fees, clauses associated with the card on the fine print.
- Rewards– What categories do your business credit cards offer the most rewards? How applicable are they to your business? Have you chosen the card that yields the most benefit and rewards to your business?
- Employee cards– In case of a major boost in your business and you are capable of offering employee cards, does your pick have that capability?
Having separate accounts on your business and personal financial efforts can help you manage your debt relief efforts much more smoothly. However, as with any other financial matter make sure you do your research prior to settling down on your credit card.
If you’re struggling to pay off debt, ACCC can help. Schedule a free credit counseling session with us today.